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Transfer of North Korean assets begins

The transfer of blacklisted North Korean assets from a Macau bank started yesterday, a report said, raising hopes of resolving the drawn-out dispute which has held up a nuclear disarmament deal.

Japan's Kyodo News quoted financial authorities in the Chinese territory as saying that US$20 million -- of a total US$25 million -- had been transferred out of Banco Delta Asia.

The remaining US$5 million was to be transferred later, Kyodo said, without specifying when the transaction would be completed.

There was no immediate confirmation from Macau authorities.

Pyongyang, which sparked international outrage when it tested an atomic bomb for the first time last year, agreed in February to shut down its nuclear reactor in return for badly needed fuel aid and diplomatic benefits.

But two months after Pyongyang was meant to have shut down its Yongbyon reactor as the first step under the deal, it is still refusing to carry out its commitments until it receives the US$25 million from the Macau bank.

The money had been frozen in 2005 amid US allegations of money-laundering and counterfeiting. Few banks were willing to handle the money for fear of sullying their own reputations.

But Russia has given permission to its banks to help transfer the funds, reportedly with the help of the US Federal Reserve Bank of New York.

Christopher Hill, the top US nuclear negotiator, said on Wednesday he expected a resolution to the dispute "very soon."

China and South Korea have also sounded upbeat in recent days about an end to the banking saga.

A North Korean official said yesterday that he expected movement this week on the Banco Delta Asia issue.

"Something will likely happen this week, I was told. I think it's a matter of time because they are talking about technical problems," An Kyong-ho was quoted by South Korea's Yonhap news agency as saying in Pyongyang.
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